OECD: the most exposed young must get help now
"If we want to avoid a generation of unemployed, it's time to help the most exposed to get jobs or education. In the long term we need structural measures to improve the basic system," says Stefano Scarpetta, the OECD's deputy director for employment, labour and social affairs.
Young people shoulder the heaviest burden during the crisis. There are nearly four million young unemployed within the OECD. On top of that there are those who have given up looking for jobs and who have ended up outside the labour market. There is a danger that many young people will see a life-long loss of pay and career, or else they'll remain on the outside altogether.
Deputy secretary-general at the OECD, Aart de Geus, presented these figures during his opening speech at the high-level conference 'Jobs for Youth' organised by the OECD and Norway's Ministry of Labour in Oslo from 21 to 22 September. The conference summed up the experiences of a four year study of the transition from school to working life and identified which concrete measures are needed to get youth into steady jobs. 16 member countries have taken part in the study, Denmark and Norway among them.
"Our greatest challenge is to get young school drop-outs into meaningful activities. That's what we're working with now," host and Norwegian Minister for Labour Hanne Bjurstrøm told the Nordic Labour Journal.
Policy makers, decision makers, social workers, researchers, employer and employee representatives and youth organisations all spent the conference's first day to discuss how to best secure young people a good transition from school to working life and a life-long career. The results of that debate were fed back to the meeting of ministers the next day.
Feedback to ministers
Bo Smith, chairman of OECD's employment, labour and social affairs committee and head of department at the Danish Ministry of Employment, quickly summed up for the Nordic Labour Journal five main points of importance for the meeting of ministers. Firstly, there are great differences between countries. Then, labor market flexibility is not necessarily a good thing, but must be seen in the context of job and income security. Thirdly, close follow-up of young people and individualised approaches is important not only in the short term, but as an investment in the future. Furthermore, the chance of success is ten percent policy development and measures and 90 percent execution. A good execution must come through cooperation between authorities and working life organisations. Finally he underlined what the young people themselves had said about not undermining their courage but to help them improve their self esteem.
Prevent lasting impacts
Today's economic growth is not strong enough to secure jobs to many young people. There is a danger that many will be left outside for so long that the impact will be lasting, or that they get stuck in temporary of badly paid jobs.
Two large groups are of special concern and will need immediate attention. One is school drop-outs who won't be found among job seekers (NEET - neither in employment nor in education or training). Even before the crisis, in 2005, the so-called 'left-behinds' represented 11 percent of youths between 15 and 29.
The other group is people with an education but who are only loosely integrated into the labour market. They swing between temporary jobs and unemployment or inactivity. In 2005 this group was estimated to comprise eight percent of youths between 15 and 29.
"The number of youths at risk has increased considerably during the crisis. It doesn't have to mean a lost generation if we help young people now get a formal education and a better transition between schools and working life. Those who have lost their apprenticeship contracts are especially at risk," says Stefano Scarpetta.
Victims of flexibility
There's been a trend towards an increasingly flexible labour market by increasing the number of temporary jobs. OECD's analysis concludes this is the worst imaginable way forward for youths.
"Several countries have liberalised their legislation and opened the door to more temporary jobs without also easing inflexible rules governing permament jobs. This has given employers strong incentives to hire young people in temporary jobs without offering a stepping stone to safe jobs with steady incomes and the opportunity for career and skills development. There is therefore a great need to balance flexibility and job security.
"We also see a need for labour market measures and income support for young people already in work, but it is important to link such support with strong incentives to apply for jobs. We need a package of measures," says Stefano Scarpetta.
He points to the Dutch solution which is designed to prevent young people being left to their own devices and disconnected from the labour market, like what has happened during earlier crisis.
Nordic countries differ
Denmark gets praise for its system which allows adjustment to labour market measures in line with unemployment levels, and for implementing measures targeted on different groups of youths as early as November 2009.
"The Nordic countries are very different from each other, but they share a generous welfare system and are able to use large resources to get people back into work," says Stefano Scarpetta, and elaborates:
"Take Sweden - they have very high youth unemployment. Even before the crisis a lot of young Swedish people were in temporary jobs. Many manage to get out and into permanent work, but many are also stuck with temporary jobs. Norway too faces some challenges; while general unemployment is low, youth unemployment is on the rise and many struggle with the transition from school to working life. But the Nordic countries have generous welfare systems and strong incentives to get seek jobs. We believe strongly in that kind of combination of measures, yet it is not enough. There must be jobs in the market and we need a growing economy.
"The flexible Anglo-Saxon model found in the US, UK and Ireland has run into trouble during the crisis, but might enjoy a quicker work recovery when the crisis ends if we're to judge from previous experience.
"Countries like Spain and Italy, and to a certain extent France, which have opened up for more temporary jobs, are facing great problems with high unemployment figures especially among more exposed groups like youths and immigrants. Most of the jobs that have disappeared have been temporary jobs. From this we can learn that we need structural measures to reduce unemployment long term, and in the short term people need an income they can live off. "
"We hope to hear from people that they have learned from other countries' experience. Not to copy them, but to be inspired. That's what the OECD tries to do - we don't want to push solutions on countries, but we compare experiences from different countries which might give inspiration to learn. And there are plenty of interesting experiences to learn from here," Stefano Scarpetta tells the Nordic Labour Journal.